Significant Factors Affecting Cross-Border Logistics through the Port of Laredo
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1 Significant Factors Affecting Cross-Border Logistics through the Port of Laredo Ben Escarcega September 11, 2014
2 Agenda NYK and Yusen Logistics History and Laredo Services Current & Future Trends Significant Commercial Investments Automotive Oil & Natural Gas Driver Shortage Peak Season Security
3 NYK and Yusen Logistics 1885: Foundation of Nippon Yusen Kaisha (NYK) in Tokyo, Japan 1899: First ocean liner service from Tokyo to London 1950s: NYK Line, NYK Logistics, and Yusen Air & Sea 2008: NYK Logistics purchased Bruni International in Laredo, TX 2011: NYK Logistics merged with Yusen Air & Sea to become Yusen Logistics 2014: 450 offices in 40 countries; Global Top 20 Logistics company; NYK Group $26B Laredo & Mexico: Land, Air and Sea Transportation, Customs Brokerage, Warehousing
4 Recent Investments in Laredo Marten (14 Acres) Celadon (51 Acres) Conway (76k SF) US Cold Storage (60k SF) Transmaritime (64k SF) Livingston International (10k SF) GOMSA (75k SF) Gonzalez Torres (90k SF) Protrans (250k SF) Laser Forwarding (50k SF) Truck Movers Depot (300 Acres) And many more Source: Forum Commercial Real Estate, LLC
5 Automotive Industry Motor Vehicle Parts: Laredo s #1 Import & Export and GROWING Commercial Vehicles: #2 Import ~ 15,000 trucks/month from Freightliner & Navistar Nearshoring: 1,100+ top tier suppliers in Mexico¹ (NAFTA, Mexican FTAs) Top 10 Original Equipment Manufacturers (OEMs) in Mexico 80% of cars exported, majority to USA = 11% new car sales in USA¹ WorldCity: Laredo s Trade with Japan falls 4th straight year Mexico s Newest OEMs 2014: Mazda, Nissan, Honda in Bajio 2016: Audi: $1.3B in Puebla; Kia $1B in Monterrey 2017: Nissan/Daimler: $1.4B OEM in Aguascalientes 2019: BMW: $1B in San Luis Potosi ¹Source: Asociacion Mexicana de la Industria Automotriz, 2014
6 Source: Automotive Meetings, 2014
7 Automotive Industry Logistics Requires every mode of Transportation Motor Vehicles: Roll On Roll Off (RORO) vessels, Rail, Driveaways or Piggybacks Motor Vehicle Parts: straight trucks, 53 OTR with solos and teams, charter air service and hand-carries
8 Oil & Natural Gas Wild West again in South Texas, a Bonanza Laredo s #2 Export to Mexico: Gasoline, other fuels up to $2.95B¹ Wide Impact on Logistics Local Employment demand for drivers and mechanics Highway Safety 3,450 accidents and 238 fatalities in 2013² Infrastructure Development in Mexico: pipelines Natural Gas trucks ¹Source: WorldCity, 2014 Laredo TradeNumbers. ²Source: Texas Department of Transportation, 2014
9 Driver Shortage A Major Problem Getting Worse Shortage of 30,000 50,000 long haul OTR drivers¹ Average 90% Turnover Government regulations New truck costs of $120,000+ A different generation Trucking Company Responses Customers: rate Increases, more driver-friendly facilities Drivers: pay increases, sign-on bonuses, health centers, driver recognition programs, new trucks for top drivers, Idle Air, etc B1 Permit and H2B Visa Programs ¹Source: American Trucking Association, 2014
10 Laredo s Dry Van OTR Peak Season March through July Still a Surprise to shippers, but eagerly awaited for by carriers Advance preparation recommended Peak Season Surcharges (PSS) Causes More Northbound than Southbound Early Mexican produce season USA summer holidays & school vacations = US spending Automotive Retooling Requires more research Impact on Logistics Spot Market rates Transloads
11 Security Customs Priorities USA terrorists, bombs, drugs, undocumented immigrants, counterfeit goods Mexico import duties, contraband, guns, money Federal Programs NEEC Nuevo Esquema de Empresas Certificadas: Mexican C-TPAT C-TPAT Customs Trade Partnership Against Terrorism TSA air freight forwarding Preventive Measures Security escorts Convoys Satellite tracking and Geo Fencing Security audits at Mexican shippers
12 Summary The Automotive and Oil & Natural Gas Industries are two of the most significant factors influencing logistics in Laredo Urgent action needs to be taken to address the driver shortage which reduces capacity Peak Season in Laredo causes major disruptions in the marketplace and needs to be addressed in a more consistent manner by shippers and logistics companies Security has to remain our top priority to protect Laredo s growing economy
13 どうもありがとうございました
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